U.S. Dairy Exports Remain Lower YOY but Increase Seasonally…
According to USDA, the total value of all U.S. dairy exports declined YOY for the ninth consecutive month in Apr ’15, finishing 22.3% below the previous year. The total value of all U.S. dairy exports did increase MOM on a daily average basis for the third consecutive month, increasing 1.4% to an eight month high. Dairy exports typically increase seasonally from March – April, with the total value increasing by an average of 3.4% over the past five years. West Coast port issues were resolved in late February, however export volumes continue to be negatively affected by a strengthening dollar relative to the currencies of traditional buyers of U.S. dairy products. A strengthening dollar results in less purchasing power for importing countries, and ultimately less foreign demand for U.S. products, all other factors being equal.
Butter – YOY Export Volumes Decline for 12th Consecutive Month, Finish Down 72.2%
Apr ’15 export volumes of butterfat remained weak, declining by 72.2% YOY and 5.3% MOM on a daily average basis. Butterfat exports began to slow in the second quarter of 2014 and have remained lower YOY for 12 consecutive months, with total volumes down 62.8% over the period. U.S. butter prices have traded at a premium to Europe and New Zealand butter prices when adjusted to 80% butterfat since May, reducing export demand. The spreads peaked in Sep ’14, with U.S. butter prices trading at an 80.6% premium to European prices and a 128.1% premium to Oceania prices. Domestic butter price premiums declined throughout the fourth quarter of 2014 and into 2015, but have begun to increase once again in Apr ’15. ’14-’15 YTD butterfat exports are down 72.8% YOY through the first seven months of the production season.
Cheese – YOY Export Volumes Remain Lower on Weak Cheddar Cheese Demand
Apr ’15 U.S. cheese export volumes remained lower on a YOY basis for the seventh consecutive month, finishing down 6.2% while also declining 4.6% MOM on a daily average basis. Cheddar cheese exports remained particularly weak, declining 47.7% YOY. U.S. cheddar cheese prices traded at a premium to Oceania cheddar cheese prices throughout Apr ’15 for the first time in five months, with the U.S. price premium continuing to strengthen into May ’15. Apr ’15 cheese volumes destined to Mexico remained higher on a YOY basis, increasing by 48.3%, however volumes shipped to all other destinations declined 17.5% YOY. ’14-’15 YTD cheese exports are down 10.0% YOY through the first seven months of the production season, with cheddar cheese exports down 49.0% over the same period.
Dry Whey – Exports Decline YOY for 11th Consecutive Month, Finish Down 21.8%
Apr ’15 export volumes of dry whey increased 2.6% MOM on a daily average basis but remained lower YOY, finishing down 21.8%. Dry whey exports have increased MOM for three consecutive months, but despite the recent gains, the Apr ’15 YOY decline in dry whey export volumes was the fourth largest in over two years on a percentage basis. YOY dry whey export volumes have declined for 11 consecutive months after beginning the ’13-’14 production season with YOY increases in seven of the first eight months, with total volumes declining by 17.2% over the period. ’14-’15 YTD dry whey exports are down 19.5% YOY through the first seven months of the production season.
NFDM/SMP –Exports Continue to Increase, Reach Third Highest Figure on Record
Apr ’15 export volumes of NFDM/SMP continued to increase, finishing up 8.0% YOY and 7.8% MOM on a daily average basis. Apr ’15 export volumes were a record high for the month of April and the third highest monthly figure ever recorded. U.S. NFDM/SMP exports to Mexico remained particularly strong, increasing by 20.3% YOY, while exports to Vietnam, Indonesia and Pakistan also increased significantly YOY. Shipments to the aforementioned countries accounted for over half of the total Apr ’15 NFDM/SMP exports. Despite the recent increases, ’14-’15 YTD NFDM/SMP exports remain down 6.9% YOY through the first seven months of the production season.
Overall, U.S. dairy export volumes were equivalent to 16.7% of total U.S. milk solids production in Apr ’15, the most since Jun ’14.
See the chart below for a summary of key U.S. dairy product exports as a percentage of production in Apr ’15 vs. a year ago.
Butter – YOY Export Volumes Decline for 12th Consecutive Month, Finish Down 72.2%
Apr ’15 export volumes of butterfat remained weak, declining by 72.2% YOY and 5.3% MOM on a daily average basis. Butterfat exports began to slow in the second quarter of 2014 and have remained lower YOY for 12 consecutive months, with total volumes down 62.8% over the period. U.S. butter prices have traded at a premium to Europe and New Zealand butter prices when adjusted to 80% butterfat since May, reducing export demand. The spreads peaked in Sep ’14, with U.S. butter prices trading at an 80.6% premium to European prices and a 128.1% premium to Oceania prices. Domestic butter price premiums declined throughout the fourth quarter of 2014 and into 2015, but have begun to increase once again in Apr ’15. ’14-’15 YTD butterfat exports are down 72.8% YOY through the first seven months of the production season.
Cheese – YOY Export Volumes Remain Lower on Weak Cheddar Cheese Demand
Apr ’15 U.S. cheese export volumes remained lower on a YOY basis for the seventh consecutive month, finishing down 6.2% while also declining 4.6% MOM on a daily average basis. Cheddar cheese exports remained particularly weak, declining 47.7% YOY. U.S. cheddar cheese prices traded at a premium to Oceania cheddar cheese prices throughout Apr ’15 for the first time in five months, with the U.S. price premium continuing to strengthen into May ’15. Apr ’15 cheese volumes destined to Mexico remained higher on a YOY basis, increasing by 48.3%, however volumes shipped to all other destinations declined 17.5% YOY. ’14-’15 YTD cheese exports are down 10.0% YOY through the first seven months of the production season, with cheddar cheese exports down 49.0% over the same period.
Dry Whey – Exports Decline YOY for 11th Consecutive Month, Finish Down 21.8%
Apr ’15 export volumes of dry whey increased 2.6% MOM on a daily average basis but remained lower YOY, finishing down 21.8%. Dry whey exports have increased MOM for three consecutive months, but despite the recent gains, the Apr ’15 YOY decline in dry whey export volumes was the fourth largest in over two years on a percentage basis. YOY dry whey export volumes have declined for 11 consecutive months after beginning the ’13-’14 production season with YOY increases in seven of the first eight months, with total volumes declining by 17.2% over the period. ’14-’15 YTD dry whey exports are down 19.5% YOY through the first seven months of the production season.
NFDM/SMP –Exports Continue to Increase, Reach Third Highest Figure on Record
Apr ’15 export volumes of NFDM/SMP continued to increase, finishing up 8.0% YOY and 7.8% MOM on a daily average basis. Apr ’15 export volumes were a record high for the month of April and the third highest monthly figure ever recorded. U.S. NFDM/SMP exports to Mexico remained particularly strong, increasing by 20.3% YOY, while exports to Vietnam, Indonesia and Pakistan also increased significantly YOY. Shipments to the aforementioned countries accounted for over half of the total Apr ’15 NFDM/SMP exports. Despite the recent increases, ’14-’15 YTD NFDM/SMP exports remain down 6.9% YOY through the first seven months of the production season.
Overall, U.S. dairy export volumes were equivalent to 16.7% of total U.S. milk solids production in Apr ’15, the most since Jun ’14.
See the chart below for a summary of key U.S. dairy product exports as a percentage of production in Apr ’15 vs. a year ago.